Archives for March 11, 2019

Ever since Bitcoin fell to its most recent local bottom of $3,400 back on February 6, 2019, the leading cryptocurrency by market cap has been in the longest stretch of uptrend since reaching its all-time high of $20,000.

Facebook’s reported stablecoin project could be a significant moneymaker for the social media giant, according to Barclays analyst Ross Sandler.

In a note to investors first reported by CNBC and later obtained by CoinDesk, Sandler says Facebook’s cryptocurrency efforts could yield anywhere from $3 billion to $19 billion in additional revenue by 2021. To put that estimate in context, the Menlo Park, California, company brought in $40.6 billion in total revenue in 2017, with $39.9 billion from advertising.

Sandler also sees two primary challenges for Facebook achieving its crypto goals: “demonstrating a value prop for users above what is available today in payments” and overcoming consumers’ “trust issues after 2018’s problems.”

In an apparent bid to account for said trust issues, CEO Mark Zuckerberg issued a lengthy post last week calling for Facebook to become more privacy-oriented in the years ahead. While “cryptocurrency” isn’t mentioned, payments and encryption are frequently invoked.

Face from the past

Sandler of Barclays noted that much remains unclear about Facebook’s crypto project. However, there is a precedent for virtual currency on the social media site: Facebook Credits.

“Facebook coin may simply be [looking] to process micro-transactions and re-invigorate the original business model that was in place in 2010-2012 under Facebook Credits,” Sandler wrote. “However, the scope of the project could be much larger, especially considering David Marcus (former CEO of PayPal) is heading up the project.”

Indeed, Facebook has been on a hiring spree on the cryptocurrency front in recent months, with a hiring push and at least one startup acqui-hire.

Underscoring the breadth of the recruitment program, Facebook’s careers website now lists 20 job openings related to the technology.

The Court of Justice in São Paulo, Brazil, has recently ruled Banco Santander has to unfreeze the account of a local cryptocurrency exchange, Mercado Bitcoin, with over 1.35 million reals ($350,000) in it. This, after determining a “lack of regulations doesn’t make [something] a criminal activity”.

According to local news outlet Portal do Bitcoin, judge Renata Barros Souto Maior Baião ruled in favor of the cryptocurrency exchange after determining bank Santander acted in an abusive way, as it apprehended the resources of Mercado Bitcoin “over fraudulent operations conducted by third parties.”

As a result, Santander was forced to unfreeze the exchange’s $350,000, with “interest of 1% per month.” In the case, the judge clarified that a lack of clear regulations on cryptocurrencies and businesses doesn’t mean illicit activities are going on.

Baião added, in fact, that the exchange, acting on good faith, isn’t responsible for the action of its users.

Bank Freezes Crypto Exchange’s Account

Going into detail, the case itself was brought forward by Mercado Bitcoin after Banco Santander froze its account, claiming there were “bank fraud” suspicious involving some the crypto trading platform’s clients.

Summarizing what exactly happened, the news outlet clarifies “several Santander clients carried out transactions that benefited other bank clients, which in turn used the funds to purchase cryptocurrencies” with Mercado Bitcoin.

Per the case, Santander analyzed various transactions related to the case and found out dates, values and favored, even incurring in Google Street View searches to gauge the financial conditions of those involved.”

It found out who was benefiting from the fraud. Instead of acting against them, it decided to block the crypto exchange’s account. In the sentence, the judge stated:

Faced with such a scenario, the banking house itself might have sought to hold those who made the fraudulent transfers accountable, but instead preferred to block the account of the author and appropriate the amounts therein up to the full value of the transactions.

Baião also made it clear the cryptocurrency exchange’s security systems aren’t good enough to prevent fraud, but noted the bank attempted to “criminalize” cryptocurrency-related transactions, even though Brazil’s central bank hasn’t declared Mercado Bitcoin’s activity illegal.

She added that Mercado Bitcoin doesn’t have to supervise its users to determine whether they’re declaring their cryptocurrency purchases.

Bitcoin price under pressureLiquidity to take a hit as Binance undergoes maintenanceTransactional volumes dropping, average at 7k—data streams from BitFinexBeginning 2 AM UTC, Binance will be under maintenance for eight hours. During that time, Bitcoin (BTC) may come under renewed liquidation that could see it drop towards $3,800.Bitcoin Price AnalysisFundamentalsBinance is the world’s largest exchange by adjusted volumes, and, therefore, a leading source of liquidity for crypto assets including BTC. Tomorrow, the exchange plans for a scheduled maintenance that from 2 AM UTC for eight hours.#Binance System Upgrade Noticehttps://t.co/3IFDqDzTVmpic.twitter.com/u2TBaYeVh7— Binance (@binance) March 11, 2019While such support is a non-issue in traditional exchanges, it is the 24/7 operation of crypto that forces this choice. If anything, this is a hard choice, a balancing act, which Binance must make to ensure high reliability while simultaneously safeguarding user funds from malicious agents always searching for vulnerabilities.In that case, we expect a dip in volumes right in the middle of a working day in Japan and South Korea. Japanese and South Koreans are ardent crypto fans, and most trading volumes originate from these locations.Perhaps the aura of caution is a reminder of the Q4 2018 pains. A few days before the contentious Bitcoin Cash hard fork, Binance was taken offline for eight hours in another scheduled maintenance.Candlestick ArrangementAs of this writing, Bitcoin (BTC) is stable and up 1.2 percent from last week’s close. Although traders and investors are cautious, our bullish stance is valid. To that end, every low should be another level of readjustment, a loading zone with modest target at $4,500—Dec 2018 highs.However, considering headwinds of the last few days, bears of Feb 24 may flow back triggering liquidation. That will be the case if candlestick arrangement is our guide. If we paste a Fibonacci retracement tool at Feb 24 high low, then it is clear that bears are flowing in at the 50 percent Fibonacci level, a key reaction point.Bitcoin (BTC) buyers need to support prices to prevent liquidation towards Mar 5 lows of $3,800. Otherwise, by today’s close we shall have a three-bar bear reversal pattern. If confirmed, a drop towards $3,800 will be highly likely.Technical IndicatorsFeb 24 wide-ranging, high volume bar defines our price action. Like we have mentioned above, we need a complete reversal of Feb 24 losses. Accompanying that thrust above $4,500 or Feb 24 highs should be high transactional volumes exceeding recent averages of 7k and 36k of Feb 24.

There’s a massive upside for Facebook entering the crypto space, according to tech analysts on Wall Street. The Facebook cryptocurrency, which will reportedly be used to facilitate cross-border payments and will have stablecoin properties, is worth at least $19 billion in revenue within the next two years, CNBC reports.

Google Play Earns $6 Per User — Will Facebook Payments Match That?

Ross Sandler is an internet analyst for Barclays. He bases his math on the success of Google Play, which reportedly earns $6 per user. If Facebook has similar usage with its payments platform, its annual revenues will jump by $19 billion. The social media giant has just over 3 billion users.

Sandler believes the stock will gain renewed confidence as soon as Facebook begins finding ways to profit outside of advertising and other means that compromise user privacy. Entirely optional revenue models, like the ability to send low-fee payments across borders to friends and family, are likely to receive praise from Silicon Valley to Washington, DC.

Sandler told CNBC:

“Merely establishing this revenue stream starts to change the story for Facebook shares in our view. Any attempt to build out revenue streams outside of advertising, especially those that don’t abuse user privacy are likely to be well-received by Facebook’s shareholders.”

Facebook and Google are both masters of targeted advertising, which has led to extreme criticism and regulatory investigations. While Google continually launches services that earn non-advertising revenue, Zuckerberg and company have been slow to adapt to a changing landscape. The Cambridge Analytica scandal remains fresh in the public’s memory.

However, user growth has continued at an impressive rate. The company has around half the world on its platforms – even more, if you discount the many millions who are not yet old enough to legally have a Facebook account.

Betting on a Multi-Purpose Crypto Network

Facebook is said to have already contacted Bitcoin exchanges about helping it issue its WhatsApp cryptocurrency. | Source: REUTERS / Dado Ruvic

Sandler speculates that the cryptocurrency doesn’t have to be just a peer-to-peer payments mechanism. He thinks Facebook will use the token for things like premium content as well.

Monetizing the platform will create a lot of unique opportunities for the company. For example, investing groups could charge for access. Or social media personalities could sell exclusive access to live streams. Consultants could use the currency to manage cross-border client payments.

Perhaps most importantly, in regions like Venezuela, where the local currency is unreliable, Facebook users can have a more reliable stablecoin-like currency in a mostly-secure digital space. The company should have less difficulty offering the service to its global user base by using blockchain – particularly in regions that ban Facebook, like China.

To justify his speculations, Sandler notes that the head of the cryptocurrency’s development team is former PayPal executive David Marcus.

One question that arises is where else Facebook payments might integrate. The company’s user base outsizes many payment platforms. If all one needs to use it is a Facebook account, it’s not hard to imagine businesses accepting it for goods and services.

However, getting into the money services business presents as many challenges as it does revenue opportunities. The industry is highly regulated on a global basis, and the security implications of monetizing every account are more than obvious.

Ripple prices below 34 cents, in range modeJPM Coin not a threat, Brad Garlinghouse assuresTransactional volumes low, averaging 14 millionBrad Garlinghouse, the CEO of Ripple Inc, is confident that JPM Coin private nature is not a threat to XRP. Even so, Ripple (XRP) prices are struggling and yet to breach the 34 cents mark.Ripple Price AnalysisFundamentalsIn a way, JPM Coin is a pioneer in that it is the first major, USD backed cryptocurrency issued by a major bank. Here’s why it is noteworthy. Aside from Jamie Dimon opinion on crypto, the bank he heads is a mover. JP Morgan and Chase have a net income of US$32.474 billion and AUM of US$2.733 trillion. However, it doesn’t stop there. The bank is a behemoth on its own and one of the oldest in the US.Therefore, their decision to issue a stable coin redeemable 1:1 with the USD is something remarkable if not shaping. It also spells stiff competition for Ripple Inc eager on clipping market share from SWIFT, a self-serving global network created by the world’s leading banks.Despite this, Brad Garlinghouse is unfazed, and at the recent DC Blockchain Summit, he said the problem is with its centralization. Explicitly formed for institutional transfers, Brad insists that JPM Coin fails to tackle a use case and therefore will find it hard to gain traction.Candlestick ArrangementsAt the time of press, XRP is stable and trading within a tight trade range. Even though we are bullish on the coin, expecting a rebound from 30 cents, it is the lack of conviction from the optimistic side of the equation that is stalling our prospects.To reiterate our previous stands, Ripple (XRP) is technically bullish and the longer this BB squeeze becomes, we expect a break and close above 34 cents. The level marks the 61.8 percent Fibonacci retracement off Dec 2018 high low.Before then, the failure of bulls to build momentum and rally above this mark means there are high odds of a break out that will validate our trade plans.Technical IndicatorsCompared to trade volumes of Feb 24, Ripple (XRP) transaction levels are low, averaging 14 million. Since our anchor bar is Feb 24—61 million, it is until there is an increase of activity, driving prices above 34 cents or below 30 cents complete with high trading volumes—preferably above 61 million, that we shall add our longs or liquidate our position.

In yet another sign that the Crypto Winter is beginning to thaw, fundraising in the industry is once again alive and well. Ground X Corp, which is the crypto arm of South Korea-based mobile giant Kakao, has raised a cool $90 million in a private coin offering and is targeting the same amount in yet another fundraising round expected to kick off this week, Bloomberg reports. Ground X’s decision not to pursue a public crowdsale could be indicative of the regulatory ambiguity surrounding ICOs.

Kakao-Backed Ground X Raises Major Capital Through Crypto Token Sale

Ground X is behind a public blockchain called Klaytn, which after being delayed last year is expected to make its debut in June. While the token sale was not public, big investors were lining up regardless of the approximately 80% decline in the bitcoin price since the peak.

Ground X’s private token sale unfolded over a three-month stretch at year-end 2018, attracting institutional investors across private equity and venture capital including China-Focused IDG Capital, South Korea-based Crescendo Equity Partners, and U.S.-based Translink Capital, the latter of which is dedicated to helping entrepreneurs establish partnerships in Asia. They are making a bet on Klaytn, not to mention the balance-sheet muscle of parent company Kakao, whose messaging app KakaoTalk dominates among smartphone users in South Korea.

Kakao & the Klaytn Blockchain

While the Klaytn blockchain has yet to launch, Ground X has already attracted some high profile partners, some of which boast millions of daily active users, a key metric in measuring and ranking traffic. Groud X’s parent company Kakao is exploring the possibility of adding one of its products to Klaytn, which could be Kakao Talk, Kakao Games, or music content service Melon, to name a few, all of which could be tokenized.

Ground X CEO Jason Han recently told CNBC that “if Kakao wants to transfer their services onto the blockchain, there is lots of work to do,” adding that some of the company’s services are more conducive to the blockchain than others.

The Klaytn blockchain seeks to distinguish itself from other networks by skipping the need for “wallets, private keys, and cryptograph addresses,” which they expect will make it more accessible to mainstream users and which could explain the launch delays. Ground X’s silver bullet seems to be “enhanced speed and performance of decentralized apps” on the platform, as evidenced by a block interval of less than one second and as many as 1,500 transactions per second.

Ground X has ambitious plans, with expectations to grow its number of users to 10 million over the next 12 months, which CEO Han suggests is a function of the services that are building dApps on Klaytn having already achieved wide-scale adoption.

Tron price down but bullishPartnership with Tether is positive for TRXTransactional levels low but stand to rise in days aheadThe collaboration between Tron and Tether should further innovation and provide extra liquidity for Tron based DEXs. Even so, it will be until Q2 2019 when this integration happens. Before then, bulls are in control, but trend confirmation depends on how fast prices close above 2.5 cents.Tron Price AnalysisFundamentalsThat Tether Limited (USDT) and Tron are partners is a strategic as well as a game-changing decision for both companies. No doubt, both will benefit, and as innovative companies, the inclusion of a trusted stable coin creates a new opportunity for users meaning Tron as a platform and TRX as a native currency stands to reap in significant benefits.With the announcement, the top-most beneficiary will be DEXs that run off the Tron blockchain. Add this to the milestone that Tron now has more than two million customers and week-over-week growth in the number of transactions; the launch set for Q2 2019 will be a boon for TRX as the network would have better value storage capacity.According to the CEO of Tether, Jean-Louis van der Velde:“This integration underlines our commitment to furthering innovation within the cryptocurrency space as we continue to anticipate the needs and demands of the digital asset community.”Not only does this place Tron ahead of the pack, but it will be the first time two leading blockchain firms partner for the sake of the community. The crossover will undoubtedly increase liquidity as USDT would be completely compatible with Tron’s protocols and dApps.Candlestick ArrangementRegardless, TRX is under pressure and one of the worst performers in the top 10. At press time, the coin was down 2.2 percent from last week’s close and appears to be banding with the lower BB band.From our previous TRX/USD price analysis, bulls have a chance as long as they maintain prices above Jan 13-14 lows at 2.1 cents. What would trigger aggressive traders into action is if prices resist lower lows, build on the three-bar bull reversal pattern of Mar 3-5 and after that close above Mar 5 highs at 2.5 cents.If not and there is a meltdown below 2.1 cents, the bullish breakout pattern of Jan 8 would be invalid.Technical IndicatorIn recent days, Feb 24 bear bar guides our analysis. It has an average of 37 million which is way above averages of 6.5 million. Although we are net bullish, we prefer complete reversal of Feb 24 losses behind high volumes exceeding 12 million of Mar 5 and preferably 37 million.

The real estate firm in charge of the world’s tallest building wants to develop its own crypto token.

Emaar Group, one of the the United Arab Emirates’ largest real estate developers and the firm behind the nearly 3,000 foot tall Burj Khalifa, announced Monday that it was planning to develop the “Emaar community token” for its customers and partners by the end of 2019, with an ultimate goal of launching an initial coin offering (ICO).

Customers will be able to use the token at any of Emaar’s holdings, including its malls, entertainment facilities, online shopping venues or other properties. With the community token, Emaar is targeting a potential user base of 1 billion internet users.

Few details have been released about Emaar’s ICO, but the company intends to conclude it within 12 months of the token’s initial launch. It will be available only to European buyers. Emaar did not say how much money it intends to raise.

In a statement, Emaar Properties chairman Mohamed Alabbar said the company is looking to “extend the Emaar experience,” adding:

“We have embraced the digital world even as we continue to build the most advanced and innovative physical structures and we use both to delight and benefit our customers and stakeholders globally. The Emaar community token marks a significant leap in our digital transformation journey.”

In addition to the Burj Khalifa, Emaar has developed and owns the Dubai Mall (second-largest mall by total area), the Dubai Opera, the Dubai Fountain and a number of other properties.

Lykke CEO Richard Olsen said in a statement that his startup has already developed a “cutting-edge technology infrastructure” that is ready for mass-market use.

“We are thrilled to leverage our experience and expertise to support Emaar’s mission to bring value and utility to millions of users globally,” he added.

Ethereum mining pool Sparkpool has located and verified the accidental sender of an unusually high miners’ fee and agreed to split the amount.

In a statement provided to CoinDesk, Sparkpool said it received an email from an anonymous user on Feb. 25, claiming that they had made a mistake by attaching the 2,100 ether (ETH) fee on Feb. 19 – an amount worth around $300,000 at the time.

To verify that the emailer was indeed the sender of the payment, Sparkpool replied at on Feb. 25, asking that a token amount of 0.022517 ETH be sent using the same 0x587 address to the pool’s address.

According to data on Etherscan, the owner sent the requested amount of ETH at 09:15 UTC the same day, after which Sparkpool agreed to negotiate on the next step, adding in the statement the sender is from a blockchain firm based in South Korea.

The final agreement now sees Sparkpool keep half of the 2,100 ETH for pool miners entitled to the reward and returning the other half to the South Korean firm.

After another request from Sparkpool, the owner of the 0x587 address made a second transaction of 0.666 ETH to Sparkpool with a paragraph coded into the transaction’s hash to confirm the agreed split at 05:49 UTC today (March 11).

It reads:

“Thank you SparkPool and your miners for helping us to recover our loss, we are willing to share half of 2,100 ETH with the miners to thanks the miners’ integrity.”